Environmental Assessment

United States Department of Agriculture Forest Service September 2013 Environmental Assessment Hotchkiss Reservoir Land Exchange Norwood Ranger District Grand Mesa, Uncompahgre, and Gunnison National Forests Montrose, San Miguel and Ouray Counties, Colorado Hotchkiss Reservoir For Information Contact: Dee A. Closson Lands/Minerals Staff Officer Norwood Ranger District PO Box 388 Norwood, CO 81423 (970) 327-4261 daclosson@fs.fed.us

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or part of an individual s income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USDA s TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of discrimination, write to USDA, Director, Office of Civil Rights, 1400 Independence Avenue, S.W., Washington, DC 20250-9410, or for Forest Service issues please call, toll free, (866) 632-9992 (Voice). TDD users can contact USDA through local relay or the Federal Relay at (800) 877-8339 (TDD) or (866) 377-8642 (relay voice users). USDA is an equal opportunity provider and employer. Hotchkiss Reservoir Land Exchange i

TABLE OF CONTENTS TABLE OF CONTENTS... ii SUMMARY... 1 Document Structure... 2 Background... 3 Purpose and Need for Action... 3 Proposed Action... 4 Consistency with the Forest Plan, Laws, Regulations, Policies, and Other Guidance... 10 Land Management Plan... 10 Future Use... 12 Land Ownership Adjustment Strategy (LOAS)... 13 Uncompahgre National Forest Travel Plan... 13 Decision Framework... 13 Public Involvement... 14 Issues... 16 Key issues... 16 ALTERNATIVES INCLUDING THE PROPOSED ACTION... 16 Alternatives Considered But Dropped From Detailed Analysis... 16 Alternatives... 17 Alternative 1 Proposed Action... 17 Alternative 2 No Action... 17 Comparison of Alternatives... 19 ENVIRONMENTAL CONSEQUENCES... 21 Hazardous Materials... 21 Existing Condition (No Action Alternative)... 21 Environmental Consequences (Proposed Action)... 22 Threatened and Endangered Species... 22 Existing Condition (No Action Alternative)... 22 Environmental Consequences (Proposed Action)... 22 Forest Service Sensitive Species... 22 Existing Condition (No Action Alternative)... 23 Environmental Consequences (Proposed Action)... 23 Management Indicator Species... 23 Existing Condition (No Action Alternative)... 24 Environmental Consequences (Proposed Action)... 24 Hotchkiss Reservoir Land Exchange ii

Wetlands and Floodplains... 24 Existing Condition (No Action Alternative)... 25 Environmental Consequences (Proposed Action)... 25 Cultural Resources... 25 Existing Condition (No Action Alternative)... 25 Environmental Consequences (Proposed Action)... 26 Minerals... 26 Existing Condition (No Action Alternative)... 26 Environmental Consequences (Proposed Action)... 26 Recreation... 26 Existing Condition (No Action Alternative)... 27 Environmental Consequences (Proposed Action)... 27 Valuation... 27 Cumulative Effects... 27 CONSULTATION AND COORDINATION... 28 Document Preparers... 28 Federal, State, and Local Agencies... 28 Tribes... 28 Others... 28 Documents Referenced... 29 Hotchkiss Reservoir Land Exchange iii

SUMMARY The land exchange proposal that is considered in this document is located within the Norwood and Ouray Ranger Districts of the Grand Mesa, Uncompahgre and Gunnison (GMUG) National Forests, as shown on the Vicinity Map. Vicinity Map Federal Parcel No. 2 61.189 acres Federal Parcel No. 3 27.46 acres Sanborn Park Road (NFSR 530) National Forest Boundary Dave Wood Road (NFSR 510) NFSR 514 Non-Federal Parcel 726.119 acres NFSR 551 Federal Parcel No. 1 704.973 acres WAPA Power line Disclaimer The USDA Forest Service makes no warranty, impressed or implied regarding the data displayed on this map, and reserves the right to correct, update, modify, or replace this information without notification. National Forest Boundary Private lands Federal Parcels Non-Federal Parcel Hotchkiss Reservoir Land Exchange 1

The non-federal parcel to be acquired consists of 726.119 acres which is located on the Uncompahgre Plateau. The federal property consists of three parcels: Federal Parcel No. 1 is located on the Norwood Ranger District which consists of 704.973 acres; Federal Parcel No. 2 is located on the Ouray Ranger District which consists of 61.189 acres; and Federal Parcel No. 3 is also located on the Ouray Ranger District consisting of 27.46 acres, for a total of 793.622 acres. All three of these parcels are also located on the Uncompahgre Plateau. One, two or three of these parcels, depending on their value, would be exchanged with Spear Colorado, L.P. INTRODUCTION Document Structure This Environmental Assessment (EA) documents the analysis of the potential environmental effects resulting from a proposal to exchange up to 793.622 acres of National Forest System (NFS) lands for a 726.119 acre non-federal inholding. In compliance with the National Environmental Policy Act (NEPA), this EA addresses the direct, indirect, and cumulative environmental impacts that may result from implementation of the proposed action or its alternatives. The information contained in this EA will allow the Forest Supervisor to make an informed decision about how best to meet the stated purpose and need for action. The decision will be documented in a Decision Notice when the environmental review process is completed. Introduction: This section includes information on the history of the project proposal, the purpose of and need for the project, and the agency s proposal for achieving that purpose and need. This section also details how the Forest Service informed the public of the proposal and how the public responded. Comparison of Alternatives, including the Proposed Action: This section provides a more detailed description of the agency s proposed action as well as alternative methods for achieving the stated purpose. These alternatives were developed based on significant issues raised by the public and other agencies. This discussion also includes possible mitigation measures. Finally, this section provides a summary table of the environmental consequences associated with each alternative. Environmental Consequences: This section describes the environmental effects of implementing the proposed action and other alternatives. This analysis is organized by resource areas. Within each section, the affected environment is described first, followed by the effects of the No Action Alternative that provides a baseline for evaluation and comparison of the other alternatives that follow. Consultation and Coordination: This section provides a list of preparers and agencies consulted during the development of the environmental assessment. Additional documentation, including more detailed analyses of project-area resources, can be found in the project planning record located at the Norwood Ranger District office in Norwood, Colorado. Hotchkiss Reservoir Land Exchange 2

Background On March 4, 2010, Spear Colorado, L.P., formally submitted a proposal to the Norwood Ranger District to proponent finance a land exchange with this Forest. Spear Colorado, L.P., currently owns what is locally known as the Weimer Property which consists of 726.119 acres located on the Uncompahgre Plateau. This property is a large non-federal inholding surrounded on all sides by National Forest System (NFS) lands. The federal property consists of three parcels: Federal Parcel No. 1 is located on the Norwood Ranger District which consists of 704.973 acres, Federal Parcel No. 2 is located on the Ouray Ranger District which consists of 61.189 acres, and Federal Parcel No. 3 is also located on the Ouray Ranger District consisting of 27.46 acres. If the Forest were to acquire the non-federal parcel, this would place all of Hotchkiss Reservoir into public ownership, thus complementing a previous land exchange that took place within the immediate surrounding area. The non-federal parcel is located within the specialty Colorado hunting Unit 61, where, on average, it takes about 15 years to draw a hunting license. This parcel would also place habitat into public ownership for the Gunnison sage grouse. Most importantly, conveying this parcel into public ownership eliminates a very large non-federal inholding, thus protecting the aforementioned features and making the very southern tip of the Uncompahgre Plateau all NFS lands. Conveying the federal parcels into private ownership further streamlines boundary patterns, eliminates a small sliver of NFS lands that requires several different land owners to obtain an easement from the Forest Service to cross, and assists in implementation of the Uncompahgre Travel Plan. Purpose and Need for Action The need for action is to acquire land to: Complement the previous Carston Land Exchange, eliminating an isolated inholding and completing the consolidation of NFS lands in this area. Acquire habitat for the Gunnison sage grouse. Allow for public access on the entire length of National Forest System Roads (NFSR) 514 and 551, which could be combined back to one road, and allow better access into the North Creek drainage. Enforce the Uncompahgre Travel Plan by eliminating illegal routes going around the nonfederal parcel. Enhance hunting experience in Unit 61, a specialty Colorado hunting unit, by eliminating a large non-federal inholding. Encourage big game to stay on NFS lands longer during the spring and fall transition times to minimize impact on private lands. Increase of 1.59 acres of water benefiting wetlands on NFS lands. Place all of the 4.68 acre Hotchkiss Reservoir into public ownership. Hotchkiss Reservoir Land Exchange 3

To convey land that: Consolidates private and Forest Service ownership patterns on the eastern Forest boundary of the Uncompahgre National Forest. Resolves a right-of-way issue between the Forest and several land owners along the Dave Wood Road (NFSR 510). These landowners currently hold a special use permit from the Forest allowing access across Federal Parcel No. 3 to their subdivision. Upon completion of the land exchange, they would either hold an easement with equal or better terms than current special use permit or be allowed to purchase Federal Parcel No. 3 from Spear Colorado, LP. Conveyance of the federal parcels will allow the Forest to acquire the non-federal parcel which contains suitable sage habitat that is identified as historic range for Gunnison Sage grouse. This action responds to the goals and objectives outlined in the Grand Mesa, Uncompahgre and Gunnison National Forest Land and Resource Management Plan (Forest Plan), as amended, and helps move the project area towards desired conditions described in the Forest Plan. These goals are listed in Chapter III, pages 71-73 which states Acquire lands that are valuable for National Forest Service purposes such as lands in designated wilderness areas, rights-of-ways needed to meet resource management goals, lands that provide habitat for threatened and endangered species, lands which include floodplain or wetlands, or lands having historical or cultural resources, outstanding scenic values or critical ecosystem when these resource are threatened by change of use. The Forest Plan describes objectives in classifying lands for disposal and lists When critical or unique resource (wetlands, floodplains, essential big game winter range, threatened or endangered species habitat, etc ) effects are mitigated by reserving interests to protect the resource, or by exchange where other critical resources to be acquired are considered to be of equal or greater value. Proposed Action The Forest is considering a proposal by Spear Colorado, L.P., to exchange 726.119 acres of nonfederal land for 793.622 acres of NFS lands, all located on the Uncompahgre Plateau. The non-federal land is located in Montrose County and the federal lands are in Montrose, San Miguel and Ouray Counties. All parcels are located on the Uncompahgre Plateau of the Uncompahgre National Forest. The following non-federal lands are proposed for exchange to the Forest Service by Spear Colorado, L.P.: Hotchkiss Reservoir Land Exchange 4

Non-Federal Parcel Hotchkiss Reservoir NFSR 514 NFSR 551 N.M.P.M., T. 45 N., R. 11 W., Section 8: S½SW¼, SW¼NE¼, SE¼ Section 9: W½SE¼, SW¼ Section 17: NW¼NE¼, NW¼ Montrose County, Colorado Disclaimer The USDA Forest Service makes no warranty, impressed or implied regarding the data displayed on this map, and reserves the right to correct, update, modify, or replace this information without notification. National Forest System lands Non-Federal Parcel 726.119 acres Hotchkiss Reservoir Land Exchange 5

The following federal lands are proposed for exchange to Spear Colorado, L.P.: Federal Parcel No. 1 Eldred NFSR 551 Casselberry Spear USFS Lot 11A Approximate location of the NFSR 551 reroute Spear Spear Current route of NFSR 551 Spear Closed road USFS N.M.P.M., T. 45 N., R. 11 W., Section 15: S½S½NW¼, NE¼SW¼, W½SW¼, NW¼SE¼ Section 16: portion Section 21: portion Section 22: W½NW¼, W½SW¼, SE¼SW¼, SW¼SE¼ Section 27: portion Montrose County, CO and San Miguel County, CO WAPA Power Line Lot 6A USFS Lot 6B Disclaimer The USDA Forest Service makes no warranty, impressed or implied regarding the data displayed on this map, and reserves the right to correct, update, modify, or replace this information without notification. USFS National Forest System lands Private lands Federal Parcel 1 704.973 acres Hotchkiss Reservoir Land Exchange 6

Federal Parcel No. 2 Dave Wood Road NFSR 510 N.M.P.M., T. 46 N., R. 10 W., Section 9: portion Ouray County, CO Disclaimer The USDA Forest Service makes no warranty, impressed or implied regarding the data displayed on this map, and reserves the right to correct, update, modify, or replace this information without notification. National Forest System lands Private lands Federal Parcel 2 61.189 acres Hotchkiss Reservoir Land Exchange 7

Federal Parcel No. 3 Dave Wood Road (NFSR 510) Dave Wood Road (NFSR 510) N.M.P.M., T. 46 N., R. 10 W., Section 17: portion Section 20: portion Montrose County, CO Disclaimer The USDA Forest Service makes no warranty, impressed or implied regarding the data displayed on this map, and reserves the right to correct, update, modify, or replace this information without notification. National Forest System lands Private lands Federal Parcel 3 27.46 acres Hotchkiss Reservoir Land Exchange 8

Under the proposed action the lands proposed for acquisition by the Forest Service would include the following uses and recognized interest for the future: Land would become part of the Craig Point C&H allotment and continue to be grazed by cattle authorized under the appropriate federal grazing permits. The Craig Point and North Creek C&H allotment boundaries and pasture fences would be redesigned resulting in the removal and installation of fences. The Forest would acquire both of the historic Lambert homesteads (one of which is known as the Weimer cabin). These homesteads are eligible for the National Register of Historic Places and would be managed as such by the Forest s Heritage program. NFSR s 514 and 551 could be combined into one road and open to full size motorized vehicles, as both routes currently exist. Land would be open to the public for hunting and recreational purposes; this also includes all of Hotchkiss Reservoir. Because there are no water rights associated with the Hotchkiss Reservoir, the Forest Service would file on the water rights in the name of the United States for the reservoir for recreation, fire suppression, livestock and wildlife storage purposes. The hunting blind located due south of Hotchkiss Reservoir, on the very southeast property corner, would be removed prior to acquisition. All mineral rights associated with the non-federal parcel will be conveyed to the United States. The federal lands conveyed into private ownership: Would continue to be grazed by cattle for two years unless the permittee elects to waive their right. Future grazing would be subject to terms of a private lease should the landowner wish to allow grazing. The Craig Point and North Creek C&H allotment boundaries and pasture fences would be redesigned resulting in the removal and installation of fences. Federal Parcel No. 1 would be fenced from the northern boundary south, to just beyond VH Pasture Reservoir, with elk friendly fence. Spear Colorado, L.P. would be responsible contractually (to Forest Service specifications) for re-routing the existing NFSR 551 to the west, starting north of VH Pasture Reservoir and ending at the existing allotment fence south of VH Pasture Reservoir, at N.M.P.M., T. 45 N., R. 11 W., Sec. 21: E½NE¼. This would be completed no later than two (2) years after the closing of the land exchange. (Affects Federal Parcel No. 1). Both of the historic Barlow homesteads would be conveyed into private ownership. These homesteads are eligible for the National Register of Historic Places and would be conserved via the terms of a Memorandum of Agreement which will allow for data recovery, excavation and curation of these sites (Affects Federal Parcel No. 1). Federal Parcel No. 2 would be conveyed to Spear Colorado, L.P., subject to the existing Forest Road and Trails Act Easement issued to Ouray County for the Dave Wood Road (NFSR 510). This is an update to the proposed action in response to public comments. It has been determined not to affect appraised values or other reservations. Federal Parcel No. 3 would be conveyed to Spear Colorado, L.P. subject to a road reservation held in the name of the United States for the Dave Wood Road (NFSR 510). This is an update to the proposed action in response to public comments. It has been determined not to affect appraised values or other reservations. At closing, the Forest would convey a Forest Road Easement to Spear Colorado, L.P. for NFSR 536.3A (Spring Creek Cutoff Road). (Affects Federal Parcel No. 2). Hotchkiss Reservoir Land Exchange 9

At closing, Spear Colorado, L.P. would convey a road easement to Cornerstone Metropolitan District No. 1 for the continued use of their access road at N.M.P.M., T. 46 N., R. 10 W., Sections 17 and 20. (Affects Federal Parcel No. 3). Reserve to the United States a right-of-way thereon for ditches and canals constructed by the authority of the United States, Act of August 30, 1890 (26 Stat. 391; 43 U.S.C. 845). Mineral estate would be conveyed to Spear Colorado, L.P., for the federal parcels, except for those minerals held in private ownership. Water rights for Vurl Reservoir would be conveyed to Spear Colorado, L.P., which affects Federal Parcel No. 1. Consistency with the Forest Plan, Laws, Regulations, Policies, and Other Guidance Land Management Plan The Forest Plan was issued in 1983 and subsequently amended in 1991. A review of the Forest Plan has been made to determine this exchange proposals compliance. The Management Area Direction is applied to each management area based on the management emphasis prescribed for that area. Below are the Management Area Directions for each parcel: Non-Federal Parcel This parcel is located in Management Area 6B which is managed primarily for livestock grazing and for semi-primitive non-motorized, semi-primitive motorized and roaded natural recreation opportunities. Federal Parcel No. 1 This parcel is located in Management Area 4B and 6B. Management Area 4B is managed for semiprimitive non-motorized, semi-primitive motorized and roaded natural recreation opportunities. Livestock grazing will be compatible with wildlife habitat management. Management Area 6B is managed primarily for livestock grazing and for semi-primitive non-motorized, semi-primitive motorized and roaded natural recreation opportunities. Federal Parcel No. 2 and No. 3 These parcels are located in Management Area 4D which are primarily managed to maintain or improve aspen and to provide wood fiber, wildlife habitat, visual quality and plant and animal diversity. Semi-primitive non-motorized, semi-primitive motorized and roaded natural recreation opportunities will be provided. Listed below is the Lands direction as stated on page III 71-73 of the Forest Plan; and how the proposed land exchange complies with the Forest Plan: 1. Acquire rights-of-ways (ROW s) on existing Forest System roads and trails that cross private land. Hotchkiss Reservoir Land Exchange 10

Compliance with Forest Plan: With the acquisition of the non-federal parcel, NFSR 514 and 551 could once again form one road. NFSR 514 is on the north side of the property and NFSR 551 is on the south side of the property. Currently, the non-federal parcel dissects this road into two separate roads, since there is not a public right-of-way through this parcel. 2. Ensure floodplain and wetland values are approximately equal on both offered and selected properties. Compliance with Forest Plan: The Uncompahgre Plateau is relatively arid, with surface water generally confined to small streams most of which flow intermittently, therefore, wetlands are exceedingly rare and in nearly all cases associated with either perennial surface water or a perched groundwater aquifer. There was little to indicate that naturally occurring wetlands exists within either the federal or non-federal parcels. No jurisdictional wetlands exist within the parcels. There are no designated floodplains within the project area. The exchange as proposed would be a reasonable value for value trade with regard to floodplains and wetlands. (Spears Ranch Land Exchange, Floodplain and Wetlands Report, John Almy, October 26, 2010). 3. Classify interest in lands for acquisition according to the following priorities: a. In designated Wilderness Areas. Not applicable. b. Where lands or ROW s are needed to meet resource management goals/objectives. The non-federal land is needed to allow NFSR 514 and 551 to be combined back into one road, allowing better access into the North Creek drainage. c. Lands providing habitat for threatened and endangered species. - While not yet a federally listed species, protecting the Gunnison sage grouse habitat is critical. d. Lands which include floodplain or wetlands. - Not applicable. e. Lands having historical or cultural resources, outstanding scenic values or critical ecosystems threatened by change of use. The historic Lambert Homestead Sites, built in 1910 and 1919, reside on the non-federal parcel. 4. Classify lands for disposal according to the following priorities: a. To states, counties, cities, or other Federal agencies when disposal will serve a greater public interest. b. In small parcels intermingled with mineral or homestead patents. c. When suitable for development by the private sector is in the public interest. d. When critical or unique resource effects are mitigated by reserving interest to protect the resource, or by exchange where other critical resources to be acquired are considered to be of equal or greater value. Hotchkiss Reservoir Land Exchange 11

Future Use Compliance with Forest Plan: Conveying Federal Parcel No. 1 by exchange allows for acquisition of a public right-of-way, potential Gunnison sage grouse habitat, and places all of Hotchkiss Reservoir into public ownership (Applies to Item D above). Federal Parcel No. 2 and No. 3 are located along the Dave Wood Road (NFSR 510), which has become a commuter route between the towns of Norwood and Montrose. Due to the high activity levels in this area, these parcels are better suited in private ownership (Applies to Item C above). Non-Federal land conveyed to the Forest: Future management of the non-federal land would follow the current management area direction designated for the surrounding NFS lands as stated in the Forest Plan and the Uncompahgre National Forest Travel Plan. The non-federal parcel is located within Management Area 6B which is managed primarily for livestock grazing and for semi-primitive non-motorized, semi-primitive motorized and roaded natural recreation opportunities. This parcel would be included in the Craig Point C&H allotment and would be grazed by cattle. The fences located on this property will be evaluated for need by the District Range Conservationist with the possibility of removal of portions or possibly all. The Lambert Sites (commonly known as the Weimer Cabin) are eligible for the National Register of Historic Places and would be managed as such by the Forest Heritage Resource Program. The hunting blind located due south of Hotchkiss Reservoir, on the very southeast property corner, would be removed before acquisition. Also, upon the acquisition of this property, NFSR 514 and 551 would be combined into one road allowing the public better and uninterrupted access to this part of the Forest. Federal land conveyed to Spear Colorado, L.P.: Future management of the federal parcels would continue basically as it is today. Spear Colorado, L.P. has stated there are no plans to develop any of the properties but to keep Federal Parcel No. 1 as a sanctuary for elk and to continue grazing cattle; Federal Parcel No. 2 would be combined with other undeveloped property owned by Spear Colorado, L.P.; and Federal Parcel No. 3 would either be offered to the adjacent land owners to resolve access problems along the Dave Wood Road (NFSR 510) or a replacement easement will be granted across this parcel for access to the adjacent land. Once the federal parcels are conveyed into private ownership, they take on all of the rights and privileges afforded under state law. Future land use will be under the jurisdiction of the appropriate local government. Hotchkiss Reservoir Land Exchange 12

Land Ownership Adjustment Strategy (LOAS) All alternatives, including the proposed action, were reviewed for consistency with the Landownership Adjustment Strategy (LOAS) for the Norwood Ranger District approved on August 24, 1995. The primary objective of landownership adjustment is to achieve the optimum land ownership pattern in the National Forest System that provides for resource use and protection to meet public needs. Federal Parcel No. 1 The portions of this parcel that are located in section 15 are identified in the LOAS as property to convey for the purpose of ownership consolidation. Federal Parcel No. 2 and 3 These properties are located on the Ouray Ranger District in which a LOAS has not yet been completed. Non-Federal Parcel This parcel is identified for acquisition in the LOAS for the following reasons: 1) consolidation of ownership; 2) management efficiency; 3) to acquire inholdings; 4) acquire access to NFS lands and 5) acquire critical wildlife habitat. Uncompahgre National Forest Travel Plan The Record of Decision for the Uncompahgre National Forest Travel Management Plan (Uncompahgre TMP) was signed in March 2002. This Uncompahgre TMP identifies which roads and trails on the Forest are open to motorized use and the type of uses allowed on these routes. The proposed action was developed to be consistent with Uncompahgre TMP objectives. Routes necessary to meet travel objectives for administration and public use through the federal parcels were identified for rights-of-way reservation. Management of routes on acquired lands would be consistent with current use and resource protection requirements. Decision Framework This EA will need to be of sufficient scope to ensure all appropriate legal and regulatory requirements are met and to provide the deciding official with sufficient information to determine whether or not the proposed action is in the public interest. It is not a decision document. Land exchanges convey land, interest in land, and resources associated with them. However, the act of conveyance has no environmental effects. Therefore, the environmental analysis will focus primarily on future use and management of lands acquired and conveyed and the effect of the exchange on lands that adjoin them (Forest Service Handbook (FSH) 5409.13). This action is in accordance with the General Exchange Act of March 20, 1922 (42 Stat. 465; 16 U.S.C. 485) as amended by the Act of February 28, 1925 (43 Stat. 1090); the Federal Land Policy and Management Act of October 21, 1976 (90 Stat. 2743; 43 U.S.C. 1716); and the Federal Land Exchange Facilitation Act of August 20, 1988 (102 Stat. 1086; 43 U.S.C. 1716). This proposal is consistent with the forest-wide standards and guidelines for land ownership adjustments presented on page III-72 of the Land and Resource Management Plan, as amended, for the Grand Mesa, Uncompahgre and Gunnison National Forest (Forest Plan, USFS 1991). Hotchkiss Reservoir Land Exchange 13

The Forest Supervisor for the GMUG is the official responsible for deciding whether or not to proceed with the proposed action as described. A Forest Plan amendment is not necessary and the decision would be effective after appeals (if any) are settled. Public Involvement The proposal was listed in the Schedule of Proposed Actions for the period of July 1, 2012 to the present. The proposal was provided to Congressional Delegates, all adjacent landowners, the public, the Southern Ute Indian Tribe, environmental groups, and other agencies for comment during scoping from April 26, 2012 to May 25, 2012. A request was made to the Forest to extend the scoping period an additional 30 days, which extended the scoping period to June 25, 2012. Public notices were published in the Telluride Daily Planet, Ouray County Plaindealer, The Montrose Daily Press and The Daily Sentinel on May 25, June 1, June 8 and June 15, 2012. In addition, as part of the public involvement process, the Forest also presented the proposal to the Ouray County Commissioners on May 1, 2012; Montrose County Commissioners on May 7, 2012; and San Miguel County Commissioners on May 30, 2012. Public open houses were also held on May 16, 2012 in Norwood, Colorado and May 23, 2012 in Montrose, Colorado. The Forest Service received twelve comment letters regarding this project. Those comments are summarized below. Continue allowing public access to NFSR 551 upon conveyance of Federal Parcel 1. NFSR 551 would remain on NFS lands and open to the public. The portion of this road that is located within Federal Parcel 1 would be relocated back onto NFS lands at the expense of the proponent. This is already addressed in the proposed action. Continue allowing public access to the Dave Wood Road (NFSR 510) upon conveyance of Federal Parcels 2 and 3. Upon conveyance of Federal Parcels 2 and 3, public access to the Dave Wood Road would be maintained through the conveyance of a public road easement to Montrose County. This is already addressed in the proposed action. Transfer fee title to Montrose County for the Dave Wood Road (NFSR 510) as it crosses Federal parcel 3. At closing, Spear Colorado, L.P. would convey a public road easement to Montrose County for the Dave Wood Road (NFSR 510) as it crosses Federal Parcels No. 2 and No. 3. Fee title will not be vested in Montrose County through this land exchange. Will current Special Use authorizations be replaced in-kind upon conveyance of the Federal parcels? Any existing special use authorizations would be replaced in-kind from Spear Colorado, L.P., with the same rights and privileges, upon conveyance of the federal parcels. This is already addressed in the proposed action. Objection to the inclusion of Federal Parcel No. 3 in the proposed land exchange without written assurance that the historical access (to private land) will be observed and maintained. Currently the only access authorization issued across Federal Parcel No. 3 is to Cornerstone Metropolitan District No. 1. Any other private use occurring on this parcel: 1) has previously been denied, 2) is currently being used in trespass and 3) there is no adverse possession against the United States. Hotchkiss Reservoir Land Exchange 14

Private landowners adjacent to Federal Parcel 1 will lose access to National Forest as a result of the land exchange. With the exception of the Casselberry property, Spear Colorado, LP currently owns all the private land adjacent to Federal Parcel No. 1. At this time, the only way residents can access national forest lands known as Federal Parcel No. 1 is to cross lands owned by Spear Colorado, LP, the Delle Casselberry property, or they follow the Western Area Power Association (WAPA) power line to the national forest. The only property affected by this proposal is the Casselberry property, which will no longer border the national forest. The power line access is not affected by this proposal. The Forest Service does not provide or guarantee private access to public lands, except where easements exist. There are no easements in this area. See Federal Parcel No. 1 map on page 6. Describe the reason for preparing an Environmental Assessment for this land exchange instead of an Environmental Impact Statement. Land exchanges convey land, interest in land, and the resources associated with them. However, the act of conveyance has no environmental effects. Therefore, the environmental analysis will focus primarily on the future use and management of the lands acquired and conveyed and the effect of the exchange on the lands that adjoin them. (FSH 5409.13). Because there are no environmental effects associated with conveyance itself, factors affecting NEPA significance (40 CFR 1508.27) are absent that would require preparation of an EIS. In fact, land exchanges could occur without the public NEPA process ((36 CFR 220.6(d)(7)(ii)) assuming the future uses did not require authorizations that also required NEPA (easements, management of the historic sites ). Therefore, an EA is being prepared to address the effects for future uses. Address the disposition of the mineral estate and water rights for both acquired and conveyed lands. This is already addressed in the proposed action. Describe how fencing in the project area is to be addressed. This has been addressed in analysis of impacts. See Proposed Action. Final acreages are determined by appraisal. This is already addressed in the analysis of the proposed action. See Valuation section. Exchange will result in a loss of forest resources and add another isolated inholding with the conveyance of Federal Parcel 2. This is already addressed in the analysis of the proposed action. See Vegetation and Wildlife Sections. Federal Parcel 2 is approximately 61 acres between Dave Wood Road and many miles of private land therefore it is not considered an isolated parcel. Describe the effects of exchanging ponderosa pine habitat for sagebrush habitat. This is addressed in the proposed action. See the Wildlife Section. Describe the effects of connecting NFSR s 514 and 551 and its impact to wildlife. This is already addressed in the analysis of the proposed action. See Wildlife section. Describe the development of the Federal Parcels in the foreseeable future. Because there is no proposed development of the Federal parcels that is reasonably foreseeable, this is speculative and outside the scope of the analysis. Hotchkiss Reservoir Land Exchange 15

Issues Issues serve to highlight effects or unintended consequences that may occur from the proposed action and alternatives, giving opportunities during the analysis to reduce adverse effects and compare tradeoffs for the decision maker and public to understand. Issues are best identified during scoping early in the process to help set the scope of the actions, alternatives, and effects to consider; but, due to the iterative nature of the NEPA process, additional issues may come to light at any time. Key issues are defined as those directly or indirectly caused by implementing the proposed action. Issues not defined as key issues are those that are: 1) outside the scope of the proposed action; 2) already decided by law, regulation, Forest Plan or other higher level decision; 3) irrelevant to the decision to be made; or 4) conjectural and not supported by scientific or factual evidence. The Council on Environmental Quality (CEQ) NEPA regulations require this delineation in Sec. 1501.7, identify and eliminate from detailed study the issues which are not significant or which have been covered by prior environmental review (Sec. 1506.3) A list of issues and reasons regarding their categorization may be found at the Norwood Ranger District in the project record. Key issues identified during the public scoping period carried forward for analysis include: If Federal Parcel No. 1 is conveyed, a portion of prime elk habitat will become private. If Federal Parcel No. 1 becomes private, some quality hunting will be lost to the public. ALTERNATIVES INCLUDING THE PROPOSED ACTION Alternatives Considered But Dropped From Detailed Analysis Direct Purchase of Non-Federal Lands The Forest considered the alternative of acquiring the non-federal parcel by direct purchase from the owner. However, this alternative was dropped from further consideration for the following reasons: 1) the owner is unwilling to sell the property and 2) funds are currently not available. Efforts to secure the necessary appropriation would have competed against other requests regionally and nationwide and, given higher priority requests, it is unlikely the necessary funds would have been appropriated. While there are easily identified benefits associated with acquisition of these non-federal lands, they are unlikely to compete well at the national level in the highly competitive Land and Water Conservation Fund (L&WCF) process. Based on past experience, a land exchange is believed to be the only truly viable method for completing such acquisitions. Therefore, it was concluded that the land exchange process offered a more viable and expedient means of acquiring the non-federal parcel. Because this property is not currently available for purchase and no funds are available, this was not considered a viable alternative. Since this is truly not a viable alternative, it is considered unlikely to be implemented and was dismissed from further evaluation. All effects, impacts, and benefits described in this document associated with the non-federal portion of the exchange alternative would be identical to a purchase alternative. Hotchkiss Reservoir Land Exchange 16

Alternatives Alternative 1 Proposed Action The Forest would acquire the non-federal parcel, containing 726.119 acres, from Spear Colorado, L.P., located at: N.M.P.M., T. 45 N., R. 11 W., Section 8: S½SW¼, SW¼NE¼, SE¼ Section 9: W½SE¼, SW¼ Section 17: NW¼NE¼, NW¼ Montrose County, Colorado 726.119 acres In exchange, the Forest would convey Federal Parcels No. 1, No. 2 and No. 3 for a total of 793.622 acres, to Spear Colorado, L.P., at the following locations: Federal Parcel No. 1 N.M.P.M., T. 45 N., R. 11 W., Section 15: S½S½NW¼, NE¼SW¼, W½SW¼, NW¼SE¼ Section 16: portion Section 21: portion Section 22: W½NW¼, W½SW¼, SE¼SW¼, SW¼SE¼ Section 27: portion Montrose County, CO and San Miguel County, CO 704.973 acres Federal Parcel No. 2 N.M.P.M., T. 46 N., R. 10 W., Section 9: portion Ouray County, CO 61.189 acres Federal Parcel No. 3 N.M.P.M., T. 46 N., R. 10 W., Section 17: portion Section 20: portion Montrose County, CO 27.46 acres Under the proposed action the lands proposed for acquisition by the Forest Service would include the following uses and recognized interest for the future: Land would become part of the Craig Point C&H allotment and continue to be grazed by cattle authorized under the appropriate federal grazing permits. The Craig Point and North Creek C&H allotment boundaries and pasture fences would be redesigned resulting in the removal and installation of fences. The Forest would acquire both of the historic Lambert homesteads (one of which is known as the Weimer cabin). These homesteads are eligible for the National Register of Historic Places and would be managed as such by the Forest s Heritage program. Hotchkiss Reservoir Land Exchange 17

NFSR s 514 and 551 could be combined into one road and open to full size motorized vehicles, as both routes currently exist. Land would be open to the public for hunting and recreational purposes; this also includes all of Hotchkiss Reservoir. Because there are no water rights associated with the Hotchkiss Reservoir, the Forest Service would file on the water rights in the name of the United States for the reservoir for recreation, fire suppression, livestock and wildlife storage purposes. The hunting blind located due south of Hotchkiss Reservoir, on the very southeast property corner, would be removed prior to acquisition. All mineral rights associated with the non-federal parcel will be conveyed to the United States. The federal lands conveyed into private ownership: Would continue to be grazed by cattle for two years unless the permittee elects to waive their right. Future grazing would be subject to terms of a private lease should the landowner wish to allow grazing. The Craig Point and North Creek C&H allotment boundaries and pasture fences would be redesigned resulting in the removal and installation of fences. Federal Parcel No. 1 would be fenced from the northern boundary south, to just beyond VH Pasture Reservoir, with elk friendly fence. Spear Colorado, L.P. would be responsible contractually (to Forest Service specifications) for re-routing the existing NFSR 551 to the west, starting north of VH Pasture Reservoir and ending at the existing allotment fence south of VH Pasture Reservoir, at N.M.P.M., T. 45 N., R. 11 W., Sec. 21: E½NE¼. This would be completed no later than two (2) years after the closing of the land exchange. (Affects Federal Parcel No. 1). Both of the historic Barlow homesteads would be conveyed into private ownership. These homesteads are eligible for the National Register of Historic Places and would be conserved via the terms of a Memorandum of Agreement which will allow for data recovery, excavation and curation of these sites (Affects Federal Parcel No. 1). Federal Parcel No. 2 would be conveyed to Spear Colorado, L.P., subject to the existing Forest Road and Trails Act Easement issued to Ouray County for the Dave Wood Road (NFSR 510). This is an update to the proposed action in response to public comments. It has been determined not to affect appraised values or other reservations. Federal Parcel No. 3 would be conveyed to Spear Colorado, L.P. subject to a road reservation held in the name of the United States for the Dave Wood Road (NFSR 510). This is an update to the proposed action in response to public comments. It has been determined not to affect appraised values or other reservations. At closing, the Forest would convey a Forest Road Easement to Spear Colorado, L.P. for NFSR 536.3A (Spring Creek Cutoff Road). (Affects Federal Parcel No. 2). At closing, Spear Colorado, L.P. would convey a road easement to Cornerstone Metropolitan District No. 1 for the continued use of their access road at N.M.P.M., T. 46 N., R. 10 W., Sections 17 and 20. (Affects Federal Parcel No. 3). Reserve to the United States a right-of-way thereon for ditches and canals constructed by the authority of the United States, Act of August 30, 1890 (26 Stat. 391; 43 U.S.C. 845). Mineral estate would be conveyed to Spear Colorado, L.P., for the federal parcels, except for those minerals held in private ownership. Water rights for Vurl Reservoir would be conveyed to Spear Colorado, L.P., which affects Federal Parcel No. 1. Hotchkiss Reservoir Land Exchange 18

Alternative 2 No Action The current landownership pattern within the analysis area would remain the same. The proposed exchange between the Forest and Spear Colorado, L.P., would not occur under this alternative at this time. Through the design of the project, no other alternatives were considered. Analysis of this alternative provides a baseline for comparing effects of the other alternatives, providing the decision maker with a clearer basis for a reasoned choice among alternatives studied in detail. Selection of this alternative would not preclude consideration of either the federal parcel or the non-federal parcel in a future proposal. Comparison of Alternatives This section provides a summary of the effects to the NFS lands of implementing each alternative. Information is focused on activities and effects where different levels of effects or outputs among alternatives can be distinguished quantitatively or qualitatively. Comparative Indicator Alternative 1 Proposed Action Alternative 2 No Action Threatened and Endangered Species Gunnison sage grouse Would add 726.119 acres of suitable habitat into public ownership. The Federal parcels are not considered suitable habitat. Wildlife Elk habitat Federal Parcels (Exchanged): Lose 793.622 acres of summer range and some transition range for elk which is plentiful on the Uncompahgre Plateau. Non-Federal Parcel (Acquired): Would add 726.119 acres of additional winter habitat for elk which is much more limited on the Uncompahgre Plateau. No Change Elimination of an isolated inholding Removes 726.119 acre nonfederal inholding No Change Hotchkiss Reservoir Land Exchange 19

Comparative Indicator Alternative 1 Proposed Action Alternative 2 No Action Impacts to Big Game Hunting Unit 61 (Specialty Unit): Convey 704.973 acres (Federal Parcel 1) and acquire 726.119 acres (Non-Federal Parcel) of suitable hunting area. Results in net gain of 21.15 acres to Unit 61 which currently consists of 606,720 acres. Unit 62 Convey 88.65 acres (Fed. Parcels 2 and 3) and acquire 0 acres of suitable hunting area. Results in a net loss of 88.65 acres in Unit 62 which currently consists of 840,960 acres. No Change Access to National Forest System lands NFSR 514 and 551 would be combined into one road. NFSR 551 will remain on NFS lands and open to the public. Public access will continue as usual on NFSR 510 (Dave Wood Road). Access from McKenzie Springs subdivision will not change as there is no common boundary shared. NFSR 514 and 551 would remain separate roads. NFSR 551 will remain open to the public. Public access will continue on NFSR 510 (Dave Wood Road) Access from McKenzie Springs subdivision will not change as there is no common boundary shared. Hotchkiss Reservoir Land Exchange 20

ENVIRONMENTAL CONSEQUENCES This section describes the affected environment and discloses potential effects of the proposed action and alternatives. It forms the scientific and analytical basis for comparison of potential environmental effects of the alternatives. In determining potential environmental consequences of each alternative, the project interdisciplinary team considered the following: Probable consequences of each alternative on social, physical, and biological resources. Achievement of the stated purpose of and need for the project. Adherence to Forest Plan standards and guidelines. Compliance with federal and state laws and regulations. Future use and management of the lands acquired and conveyed and the effect of the exchange on the lands that adjoin them. The area of analysis for direct and indirect effects includes the federal and non-federal lands identified in the proposed action and the surrounding areas which will vary by resource. Hazardous Materials For the federal parcels, the Land Transaction Screening Process was completed and signed on May 20, 2013. This process identifies any hazardous materials that might be located on the federal parcels prior to conveyance into private ownership. For the non-federal parcel, the All Appropriate Inquiries Screening Process was completed and signed on June 14, 2013. The All Appropriate Inquiries rule prescribes federal standards and practices for conducting environmental site assessments of real property prior to acquisition. Existing Condition (No Action Alternative) Federal Parcels: The federal parcels show no evidence of release, storage or disposal of hazardous substances or petroleum products. Non-Federal Parcel: The non-federal parcel contains the historic Lambert sites, one of which is known locally as the Weimer Cabin. This structure was tested on October 10, 2012 for asbestos and lead based paint. The results showed that the cabin and outhouse contain asbestos in the log chinking. The Asbestos Containing Material (ACM) contains a regulated asbestos content (>=1% asbestos) and has been rendered friable (damaged to the point that the material crumbles easily and therefore readily releases asbestos fibers) due to weathering. This quantity of ACM (estimated at <15 square feet) is less than the Colorado State trigger level of 32 square feet and therefore is not regulated by Colorado State regulations. The structures tested negative for lead based paints. The non-federal parcel shows no other evidence of release, storage or disposal of hazardous substances or petroleum products. Hotchkiss Reservoir Land Exchange 21

Environmental Consequences (Proposed Action) Federal Parcels (exchanged): Since the federal parcels identified to exchange show no evidence of release, storage or disposal of hazardous substances or petroleum products, there would be no change from the current condition. Non-Federal Parcel (acquired): The non-federal parcel would be acquired with the historic Weimer Cabin. This structure would not be occupied in any way and will be managed by the Forest s Heritage Resource Program as an important historic structure. No other evidence of hazardous substances or petroleum products was found on this parcel. Threatened and Endangered Species A Biological Evaluation/Biological Assessment/MIS Assessment was completed on September 20, 2012. The only Threatened and Endangered Species identified was the Gunnison Sage grouse, which is a candidate for listing under the federal Endangered Species Act. Existing Condition (No Action Alternative) Federal Parcels: The current federal parcels identified to exchange are not considered to be current or historic Gunnison Sage grouse habitat. Non-Federal Parcel: The parcel to be acquired contains suitable sage habitat that is identified as historic range for Gunnison Sage grouse. This area likely served as a corridor for Gunnison Sage grouse movement between the Iron Springs area and Sanborn Park. With the current condition of the sagebrush in the area, it is likely this could have been a wintering area for sage grouse. Environmental Consequences (Proposed Action) Federal Parcels (exchanged): Since there is no habitat present in the federal parcels, there would be no loss of habitat for Gunnison Sage grouse. Non-Federal Parcel (acquired): Acquisition of the non-federal parcel would help protect the unique sagebrush ecosystem present from future land development through the acquisition of 726.119 acres of suitable habitat. Forest Service Sensitive Species An evaluation of the Forest Service sensitive species was completed on September 20, 2012. Those species identified were: Northern Goshawk Preferred habitat on the Forest appears to be large blocks of mature and old growth aspen, mixed aspen and spruce-fir, spruce-fir with remnant open crowned aspen trees, lodgepole pine, or ponderosa pine. No known nests or territories are present within the land exchange parcels. Sage Sparrow This is a sagebrush obligate species, selecting only sizeable, low-elevation stands of big sagebrush or mixed sagebrush and greasewood. There are no site specific records of this species within the project area. The non-federal parcel is considered highcountry sagebrush and could still serve as summer habitat. Hotchkiss Reservoir Land Exchange 22